Read time: 3 mins
The Value of Corporate and Start-Up Partnerships
Innovation is a key tool for managing challenges that cannot be predicted in today’s fast-paced and uncertain business world. In this video, Sandra Steving Villegas, Guest Expert on the Oxford Strategic Innovation Programme, discusses why corporations may find it valuable to partner with start-ups. She explains how contemporary mindsets and new technologies in start-ups can boost innovation when applied in the often slow-changing and traditional corporate environment.
Transcript
There’s a whole range of reasons why corporates and start-ups should explore working together. And the main one is that it’s a real opportunity to bring together two fundamentally different entities and hopefully create something that’s bigger than the sum of their parts.
Corporates have access to resources, they have expertise, they have regulatory permissions, they have capital; whereas start-ups have a lot of the new ideas, a lot of the new technologies, and very new ways of working and, kind of, a can-do mindset where nothing’s going to really stop them. And so bringing both of those two things together, there’s an opportunity to create something new.
The reality is that corporates need a really diversified playbook in order to make good on all the opportunities and the threats that are happening in the innovation space, in their categories. And most of the corporates that are doing this well are building new businesses in-house. They are also investing in exciting new technologies and start-ups, and they’re also partnering. So the reality is that partnerships are one of the key pillars for how corporates can really drive their own internal innovation agendas.
And there’s three key ways in which that really can help move the needle with regards to corporate innovation.
Corporates are notoriously slow-moving and risk averse, and working with the right kinds of partners in terms of start-ups can really help them experiment and, sort of, work much more quickly. So it allows them to, sort of, look at new business models and how they’re running. It allows them to often experiment with new data sets, trial new technologies before diving deep in and spending millions of dollars deploying them, and it can also be very important with regards to reducing costs and speeding up impact.
A lot of corporate innovation programmes are under a lot of pressure to perform and begin to deliver results and working with companies that are already doing some of these things and merging their resources and their capabilities means they can get things to market much more quickly.
And the final one, which isn’t any less important than the other two, is that it can start to shift entrenched cultures. A lot of corporates are very risk averse. They’re very operationally focused. They’re very incentivised with business as usual. And often start-ups are very good at showing them new ways of working and new ways of thinking, and perhaps beginning to, sort of, shift and create a more entrepreneurial mindset inside that corporation.